The title to this article could have read “Amazon to sell Kindle for $79″, which is the equivalent of what this offer would be if it ever appears.

Generating revenue with Kindle is all about the content. The same is true of the iPhone, game consoles, or pretty much any gadget that has content and services offered alongside the device. Some revenue may be generated from the hardware sale, but it’s the user continuing to buy content where the real profit is.

Amazon need to look at current sales of digital content for Kindle and figure out if the loss on the hardware is worth it. If a Kindle owner spends over a certain threshold on content within a year it may be worth the risk. Otherwise Amazon could insist on a multi-year Amazon Prime agreement to lower that risk.

If it ever happens, it will certainly be a compelling offer; and one that could increase the user base of Kindle dramatically. Chances are it will as Amazon has already started offering free Kindles to some of its best customers.

Reader Comments

MINI vanilli

You are incorrect. Steve Jobs specifically stated that they make their profit on the hardware of the ipod, they break even on the itunes store. things might have changed with the addition of apps ect but last i checked they made most of their profits on hardware.

Seems more like they would give a free year of Amazon Prime with Kindle purchase, and not the reverse.

mrzitro

Amazon Prime is an annual fee service. So will I have to continue paying the annual fee to keep my Kindle ($79/year to rent a Kindle)?
How profitable is Amazon Prime? If I get a Kindle, isn’t it possible that the bulk of my purchases won’t be shipped thus saving Amazon $ from further losses on Amazon Prime?